3Q 2018

Strategic Electrification Offers Load Growth and Carbon Reduction Opportunities

Strategic electrification encompasses the deployment of new technology solutions that use less carbon-intensive grid-delivered electricity and distributed renewable energy instead of fossil fuels such as natural gas, oil, diesel, or propane. Navigant Research defines strategic electrification as the deployment of cost-effective electrified technologies that lower costs, reduce environmental impacts, and enable local grid operators to flexibly reduce the cost and carbon intensity of delivered energy.

The electric power industry’s shift from centralized generation toward cleaner distributed energy resources (DER) and smart grid solutions, known as the Energy Cloud, will create new opportunities for electrified technologies and energy sector stakeholders. The growth of electric transportation technologies such as light duty EVs, medium and heavy duty e-trucks, and e-buses is expected to increase load growth for grid operators. Other customer-focused strategic electrification technologies like solar PV, battery energy storage, air source heat pumps for space heating, cooling, and water heating, and certain industrial processes will play a lesser role in load growth. These technologies can also support local decarbonization strategies. 

This Navigant Research report examines the emergence of strategic electrification technologies and various deployment strategies and business models. The study analyzes the lower cost, greener technology options that electrification creates and explores how they enable customers and grid stakeholders to reduce energy use and carbon emissions. It also provides recommendations for grid operators, EV technology vendors, automotive OEMs, and utilities and energy suppliers, among other energy sector stakeholders, on how to take advantage of the benefits of strategic electrification.

Pages 17
Tables | Charts | Figures 3
  • What are strategic electrification technologies?
  • How can strategic electrification technologies lower customer and utility costs?
  • How can strategic electrification technologies reduce environmental impacts?
  • How can strategic electrification technologies flexibly reduce the cost and carbon intensity of peak energy use?
  • How can energy sector stakeholders implement new business models to deploy strategic electrification technologies?
  • Utilities and energy suppliers
  • Utility business model strategists
  • DER project developers, systems integrators, and financiers
  • C&I solar PV, energy storage, EV, and heat pump technology manufacturers
  • Industrial electric infrared and induction heater technology vendors
  • Electric natural gas pipeline compression systems technology vendors
  • DER management system software companies
  • Federal, state, and local policymakers
  • Investor community

Spark

Context

Recommendations

Electrification Technologies Are Emerging for Customers and Grid Stakeholders

Costs for Proven Strategic Electrification Technology Are Dropping

Strategic Electrification Technologies Can Reduce Environmental Impacts

Strategic Electrification Is Capable of Grid Optimization

Electrification Creates New Options for Customers, Vendors, and Grid Stakeholders

Lower Cost, Greener Technology Options Enable Customers and Grid Stakeholders to Reduce Energy Use and Carbon Emissions

New Decarbonization Options for Policymakers Bring Positive Benefits

Grid Optimization Options Evolve for Local Grid Operators and Utilities

Guidance for Stakeholders Moving Forward

Utilities and Grid Operators Need to Examine Load Growth and Grid Optimization Benefits

DER Technology Stakeholders Need to Work Together to Benefit from and Support Strategic Electrification

DER Technology Stakeholders Need to Ensure That New Business Models Deliver Lower Grid Impacts

EV Stakeholders Need to Focus on the Potential Advantages of Electrified Vehicle Fleet Options

DER Technology Stakeholders Need to Explore Customer-Facing Financing Options

  • BEV Carbon Lifecycle Gasoline Vehicle Emissions Equivalency
  • The Coupling of Consumer and Utility Value Across VPPs
  • Select Electrification Technology Revenue, World Markets: 2018-2027
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